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Money managers under the microscope

London’s future looks cloudy

October 5, 2009

Data from HFI out today may provide further ammunition for those who fear London’s position as Europe’s hedge hub is under threat.

rtr27e5bLondon’s share of global hedge fund firms running more than $1 billion in assets slipped in the first half of 2009 to less than 15 percent from more than 17 percent.

The number of such firms it houses fell to 55 from 65 as several firms’ assets fell below the $1 billion mark.

While not an indicator that firms are moving because of next April’s 50 percent tax on high earners, some will argue it shows the UK’s prime position as home to the biggest European hedge funds is not unassailable and could be further hurt by the tax plans.

There seems little immediate threat from other locations in Europe — Paris houses just 0.74 pct, Stockholm 0.83 pct and Geneva just 0.19 pct, although such data obviously ignores where start-ups are choosing to do business.

Meanwhile, the U.S. continues to dominate the high end of the hedge fund industry, as shown below in the top five locations:

City/State           Country     Number of Firms      Assets             Pct of total assets

New York              U.S.                 118                    $642bn                  46.88

London                 UK                     55                    $203.84bn              14.86

Connecticut          U.S.                   29                     $143.84bn              10.49

California              U.S.                    22                    $80.95bn                 5.90

Massachusetts     U.S.                   12                     $84.73bn                 6.18

Source: HedgeFund Intelligence

(See also Hedgies sit on the fence)

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